The chief lobbyist for newspaper publishers told the Senate Transport and Communications committee they require the government's support to sustain the industry, according to Blacklock’s Reporter.. Person reading a newspaper .“We need them,” said Paul Deegan, CEO of News Media Canada..“We have a market failure here. We need a solution and that’s why we’ve come to government, even though, frankly, we would like to stay as far away from government and the CRTC as we can. But we do need them.”.Deegan testified about the Online News Act, also known as Bill C-18. .The proposed law would require Google and Facebook to pay newsrooms a portion of the advertising revenue earned from linked stories. To qualify for this payment, newsrooms must “follow the code of ethics of a recognized journalistic association.”.“We represent all,” said CEO Deegan. .“We’ve got everyone from the Globe & Mail, the Toronto Star, LaPresse, Le Devoir, right down to these independents.” .Being a member of the lobby group is optional. Many independent newsrooms have chosen not to join News Media Canada..Jen Gerson of Calgary, co-founder of the online newsletter The Line, on Tuesday told senators federal meddling in the business had been a “poisonous thing” for news media integrity. “Everything about this bill is a disaster.”.“Any kind of government funding to media where you have basically the entire media market to some degree dependent on legislation or government funding will inherently damage not only trust in media, but media itself,” said Gerson. .“It is a corrosive, poisonous thing. I am sure there is a business school word for it.”.Everybody ‘Starts Taking The Money’.In 2019, Parliament provided direct financial assistance to daily publishers considered “qualified” by the Canada Revenue Agency. The subsidies included a yearly payroll rebate of 25%, which could amount to $13,750 per newsroom employee. This $595 million bailout program will end on March 31, 2024..“When your competitors are all picking up the subsidy, you have to in order to compete,” said Gerson. .“Even companies that would be philosophically dead opposed to any kind of help in this regard feel as if they have to start taking the money that’s coming out of these programs and systems just to compete with their competitors.”.Blacklock’s Reporter and the Western Standard neither solicit nor accept federal subsidies..During Tuesday's testimony, Jeff Elgie, CEO of Village Media located in Sault Ste. Marie, ON, stated his business would fail if Facebook and Google chose to stop linking to news stories instead of sharing a portion of advertising revenues under Bill C-18..“There is a much worse outcome to consider,” said Elgie, Village Media publishes 25 local news websites across Ontario..“If Facebook pulls out of news in Canada as they have indicated, it will have a devastating impact on Canada’s digital news ecosystem.”.“Google and Facebook represent upwards of 50% of our total traffic,” said Elgie. .“Google is around 30% to 35%, Facebook as of yesterday is roughly 17% depending on the market we’re talking about. If that traffic is lost, the business would be over.”
